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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Cogito Ergo Sum who wrote (48293)	7/17/2012 4:11:12 PM
From: Johnny Canuck	Read Replies (1) \| Respond to of 70769

Bernanke Offers No Hint Fed Is Planning Further Easing By CNBC \| CNBC – 4 hours ago @cnbc on Twitter Email Share3 [iframe style="POSITION: static; BORDER-BOTTOM-STYLE: none; BORDER-RIGHT-STYLE: none; MARGIN: 0px; WIDTH: 90px; BORDER-TOP-STYLE: none; HEIGHT: 20px; VISIBILITY: visible; BORDER-LEFT-STYLE: none; TOP: 0px; LEFT: 0px" id=I1_1342555682925 title=+1 tabIndex=0 marginHeight=0 src="https://plusone.google.com/_/+1/fastbutton?bsv=pr&url=http%3A%2F%2Ffinance.yahoo.com%2Fnews%2Fbernanke-offers-no-hint-easing-142223317.html&size=medium&count=true&annotation=bubble&origin=http%3A%2F%2Ffinance.yahoo.com&hl=en-US&jsh=m%3B%2F_%2Fapps-static%2F_%2Fjs%2Fgapi%2F__features__%2Frt%3Dj%2Fver%3DB8SnDGBcGPY.en.%2Fsv%3D1%2Fam%3D!tlHYjvot7leYTf5X2A%2Fd%3D1%2Frs%3DAItRSTMgtpfo5t4Nbz08_iWrkbwoSBiQhg#id=I1_1342555682925&parent=http%3A%2F%2Ffinance.yahoo.com&rpctoken=762269956&_methods=onPlusOne%2C_ready%2C_close%2C_open%2C_resizeMe%2C_renderstart" frameBorder=0 width="100%" allowTransparency name=I1_1342555682925 marginWidth=0 scrolling=no][/iframe] Print Federal Reserve Chairman Ben Bernanke offered no new hints Tuesday that the central bank is planning more easing, but he repeated his pledge that the Fed "is prepared to take further action as appropriate to promote a stronger economic recovery." In prepared testimony before the Senate Banking Committee, Bernanke said economic uncertainty is increasing, mainly due to the European debt crisis and the looming "Fiscal Cliff" in the U.S. "Risks to economic growth have increased," he said, and "Europe's financial markets and economy remain under significant stress." "Reduction in unemployment is likely to be frustratingly slow," Bernanke said, but he said there were "modest signs of improvement in housing." Stocks quickly erased their early gains after Bernanke's remarks. The Dow Jones Industrial Average (Dow Jones Global Indexes: .DJIA), the S&P 500 ( ^GSPC), and the Nasdaq turned lower. Investors had hoped Bernanke would signal another round of bond purchases, meant to push down long-term interest rates and encourage more borrowing and spending. The first two rounds of the Fed's bond purchases had triggered powerful rallies in the U.S. stock market. Bernanke's testimony comes as job growth has slumped and consumers have grown more cautious about spending. On a positive note, homebuilder sentiment has risen to a 5-year high. Bernanke acknowledged those developments in his testimony. He noted that the economy, after growing at an annual rate of 2.5 percent in the second half of 2011, slowed to roughly 2 percent in the first three months of this year and likely slowed further in the April-June period. This slow economic growth prompted Senator Charles Schumer (D-NY) to grill Bernanke on the looming "fiscal cliff" - when a host of tax cuts expire and automatic spending cuts are set to kick in at the end of the year. Schumer said Congress was powerless to reverse the economic slowdown - and mitigate the fiscal cliff - but that the Federal Reserve should work to do so. "The Fed is the only game in town," said Schumer before adding, "Get to work Mr. Chairman." While Bernanke did not engage futher in debate with Schumer, he did directly address the interest rate fixing scandal facing banks and regulators. There was, he said, a "substantial response" by the New York Fed to inform appropriate authorities about European banks' susceptibilty to submit false rates - in an attempt to manipulate the London InterBank Offered Rate (LIBOR). Bernanke also called Libor's interest rate-setting system "structurally flawed." He did not, however, answer why the Fed did not make its recommendations to authorities more public back in 2008. Apart from Tuesday's testimony, minutes of the June meeting show that Fed officials were open to taking further action - but were divided over whether the economy needs help now. Since then, the government has reported that job growth slowed sharply in the April-June quarter - to 75,000 a month from 226,000 a month from January through March. The unemployment rate stayed at 8.2 percent last month. Bernanke will give testimony again on Wednesday to the House Financial Services Committee. The Associated Press contributed to this report. [Johnny: The Fed really has only one more chance to change rates in August before they take a neutral stance in advance of the run up into the election. The Fed is usually neutral to be seen as not favouring one side or the other as the country goes into an election.]